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Devolution to local government in England 2014-2016

Published Tuesday, April 5, 2016

This Commons Library briefing paper summarises the main developments regarding the process of devolution of powers to local government within England since 2014. It covers the devolution deals agreed between the Government and local areas up to July 2016, including the powers to be devolved, the procedures required for devolution to take place, and reactions to the policy from the local government and policy-making worlds.

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This note addresses the debate around devolution of power to local government in England only. Local government is a devolved matter in Scotland, Wales and Northern Ireland.

Overview of the Devolution deals

The first ‘devolution deal’ was announced by the Government and the Greater Manchester Combined Authority in November 2014. In advance of the 2015 general election, further deals followed with Sheffield (December 2014) and West Yorkshire (March 2015).

As of March 2016, devolution deals with twelve areas have been agreed.

  • Greater Manchester
  • Sheffield City Region
  • West Yorkshire
  • Cornwall
  • North-East
  • Tees Valley
  • West Midlands
  • Liverpool City Region
  • Cambridgeshire
  • Norfolk / Suffolk
  • West of England
  • Greater Lincolnshire

Discussions have also taken place on further devolution to Greater London. Table 1 in the PDF sets out the details of the devolution deals agreed as of March 2016, including links where available. Details of the local authorities involved in each devolution deal area can be found in Appendix 2 of the PDF.

Deals under negotiation

  • Derbyshire and Nottinghamshire agreed in draft as the ’North Midlands’ in January 2016, but subsequently a number of district councils have pulled out
  • Hampshire / Isle of Wight a bid was submitted from all councils in the area in September 2015. The Government approached authorities in urban South Hampshire in March 2016. Latest indications are that a deal is progressing between Portsmouth, Southampton and the Isle of Wight only

 

Bids

  • Bids from Gloucestershire, Cheshire and Warrington, and Cumbria have been reported as foundering on the areas’ opposition to a directly-elected mayor
  • Devolution bids, or expressions of interest / prospectuses, have also been published in Leicestershire; North and East Yorkshire; Surrey and Sussex; Greater Essex; and Devon / Somerset.

 

Devolution deals and Brexit

At the time of writing, no hard information is available about the likely effect on the local devolution agenda of leaving the European Union.

The main subjects of speculation

George Osborne, as Chancellor, was closely associated personally with the agenda. It is not clear whether the new Chancellor, Philip Hammond, will maintain support for the agenda within Government. Lord (Jim) O’Neill of Gatley has indicated that he would leave the Government if he perceived that the agenda was no longer being treated seriously.

Conversely, Greg Clark, the previous Secretary of State for communities and local government, claimed that he had “argued successfully … for English local government to be part of the negotiations on the terms of our exit”.

A number of sector representatives, as well as Mr Clark, have argued for a “radically expanded role for local government” in the wake of leaving the EU.

European Union structural funds have formed a major element of many devolution deals. It is not yet clear if and when structural funds will cease to be paid to UK localities. A number of sector representatives have argued that, if the funds are withdrawn, Government should make good the deficit for the 2014-20 programming period.

Greater Manchester: as of 2016

The Greater Manchester Agreement set out proposed new powers for the Greater Manchester Combined Authority (GMCA). A directly-elected mayor will be established for the whole Greater Manchester area.

The first mayoral election will take place in 2017, the next in 2020, followed by four-yearly terms. The elected mayor will receive the following powers and resources:

  • A consolidated, multi-year transport budget
  • Responsibility for franchised bus services, railway stations, and ‘smart ticketing’ (an example of this is London’s Oyster Card) in Greater Manchester
  • A Housing Investment Fund of £300m over 10 years, making loans to housebuilders (and thus being self-sustaining over time)
  • The power to produce a statutory spatial strategy, equivalent to the power of the Mayor of London: this would be subject to unanimous approval by the ‘combined authority cabinet’ (i.e. the ten leaders of the combined authority’s member authorities)
  • An enhanced form of the Manchester ‘earn-back’ agreement
  • The elected mayor will also become the Police and Crime Commissioner for Greater Manchester

In the meantime, the GMCA itself has received the following additional powers and resources:

  • Devolved business support budgets: the Growth Accelerator, Manufacturing Advice Service and UKTI Export Advice
  • Power to restructure further education in Greater Manchester, plus control of the Apprenticeship Grant for Employers
  • Joint commissioning, with the Department for Work and Pensions, of the next stage of the Work Programme
  • Control over the housing investment fund and the earn back deal, subject to the requirements set out in the Agreement, before these transfer to the mayor once s/he is elected.
  • The opportunity to plan the integration of health and social care

The new elected mayor will be subject to scrutiny by the existing scrutiny committee of the GMCA: the ‘GMCA Scrutiny Pool’, made up of 30 non-executive councillors drawn from the ten Manchester boroughs.

Further information about the Manchester deal

  • Health devolution in Greater Manchester – page 10
  • Further proposals: July 2015 budget – page 11
  • Spending Review 2015 – page 12
  • Budget 2016 – page 12
  • Justice devolution – page 13
  • Progress in Manchester – page 13

 

Liverpool: March 2016

A second devolution deal for the Liverpool City Region was announced alongside the March 2016 budget.

The city region will take on the following additional responsibilities:

  • Beginning to plan for integration of health and social care
  • A review of the delivery of children’s services
  • The Apprenticeship Grant for Employers, accompanied by discussions on the use of funding from the apprenticeship levy
  • Additional, unspecified transport and highway powers to accompany the city region’s Key Local Roads Network
  • work on developing a Clean Air Zone

Liverpool will also pilot 100% retention of business rates revenue as of 1 April 2017, in advance of English local government as a whole retaining 100% of business rates revenue from 2020.

London: December 2015

In December 2015 the Government agreed a series of pilots around health and social care collaboration with groups of London boroughs, in partnership with the Greater London Authority (GLA) and London CCGs.

NHS England and Public Health England are also fully involved. The London-based partners have also signed a London Health and Care Collaboration Agreement, committing them to joint working regarding health and care services.

Cornwall: July 2015

A devolution deal with Cornwall was agreed in July 2015. The deal was agreed with Cornwall Council and the Cornwall and Isles of Scilly NHS Trust. The deal does not require a combined authority or elected mayor to be established.

This is the only deal so far to be agreed with a single unitary authority: the powers to be devolved will be devolved to Cornwall County Council. The deal follows Cornwall Council’s publication of a document entitled The Case for Cornwall in March 2015.

West Yorkshire: March 2015

The West Yorkshire Combined Authority agreed a deal on 18 March 2015. The deal “sees the Combined Authority take further responsibility over skills, transport, employment, housing and business support”.

This includes:

  • Reform the further education system in West Yorkshire, to be done jointly by the combined authority and the Government (BIS, DfE, SFA and EFA)
  • Devolution of the Apprenticeship Grant for Employers (AGE)
  • Consultation with the Department for Work and Pensions regarding joint commissioning of the next phase of the Work Programme, from 2017
  • National and local spending on business support to be aligned through the Leeds City Region Growth Hub, with more devolution of support from 2017 onwards; closer working with UKTI and the newly created LEP International
  • More control for the Leeds City Region over the delivery of local transport schemes; improved liaison with Highways England regarding investment in the strategic highways network; infrastructure works to be aligned with Leeds City Region’s investment strategy for rail stations
  • Reconfiguration of the city region’s Joint Assets Board with the Homes and Communities Agency (HCA); development of a joint Asset and Investment Plan

 

Devolution deals in other localities

The devolution deals agreed to date can be characterised as consisting of a ‘menu with specials’. A number of items have been made available to most areas, but each deal also contains a few unique elements or ‘specials’ (typically consisting of commitments to explore future policy options).

The sections in the PDF outline the nature of the ‘menu’ powers that have been made available to most of these areas. The exact nature of the powers devolved can be seen in the deal documents.

The devolution deals agreed so far have many similarities in terms of powers to be devolved. The core powers devolved include the following:

  • Restructuring the further education system
  • Business support
  • The Work Programme
  • EU structural funds
  • Fiscal powers
  • Planning and land use

 

Further reading

The following information is also set out in the associated PDF:

  • Analysis and perspectives
  • The available powers
  • Boundaries
  • Governance
  • Reactions
  • Public consultation
  • Appendix 1: powers to be devolved in devolution deals
  • Appendix 2: participants in devolution deals

 

Further information

The Commons Library has also published notes on:

 

Publication details

Commons Briefing papers SN07029

Author: Mark Sandford

Topics: Devolution, Local government

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